Gavin Rimmington, Head of Public Sector at YPOexplains how to solve social value in the public sector
Social value is no longer an afterthought in procurement, but rather an essential part of the contracting process and continues to evolve apace, the government’s green paper Transforming Public Procurement brings it even more to the fore. ‘honor. The environmental and economic impact of businesses and services is now a determining factor in awarding a supply contract, rather than just cost and compliance.
For supply and trade professionals, social value is how any individual contract benefits the local community in which it operates, both economically and environmentally. The type of things considered under this might include whether a contract would allow for other jobs or the amount of air pollution that the contract undertaking might remove from the local area.
The residual damage that COVID has created and continues to create is taking a heavy toll on our local economies, but generating a return of social value through sourcing allows us to inject investment directly into the local area and benefit the communities we serve. serve.
Encouraging supplier diversity, even in industries where national suppliers and large suppliers appear to have a strong foothold, is one way local economies can benefit from a renewed focus on value. social. Dynamic Purchasing Systems (DPS) enable local authorities and public sector bodies to access a large number of SMEs in a wide range of services and in turn enable all relevant and potential suppliers to have a fair and equal opportunity to compete for public sector tenders. For example, the YPO Enforcement Agency DPS operates with 78% of suppliers as SMEs across the UK, with scale for large or small awards. Looking specifically at executing agency DPS, in 2021, nearly 80% of public sector client spend on this solution was with SMEs.
Social value in the public sector
A renewed focus on social value does not just benefit businesses and local communities. The public sector has come under scrutiny and pressure, particularly in times of austerity, to increase efficiency while lowering prices. Social value plays a vital role in alleviating this pressure by ensuring smarter sourcing, with more value obtained for every pound spent by government, local authorities and other public bodies, in terms of environmental benefits and economic. Beyond cost and value, bringing SMEs and local businesses into services at the public sector level will also enable a whole new perspective: local people understand local needs and will subsequently provide a more personalized service. .
Businesses and service providers need to keep thinking about their potential offerings and how best to demonstrate their social value and elevate that aspect, so they can access public sector procurement or DPS frameworks and stand before the decision makers. Ultimately, it’s about aligning with local needs, which can be done in a number of ways. Using the priorities listed in the local plan or sustainable community strategy can be a great way to start, or a more practical approach would be to consult directly with the community to find out what the value looks like in the local context. While it may be daunting to some, demonstrating social value doesn’t have to be difficult – it can be anything from engaging in more sustainability initiatives, like planting trees, to helping reduce the youth unemployment through promoting your industry in the area or working with volunteer groups in the local community.
Putting it down on paper and being able to articulate and measure your social value offering is the hardest part, but if it’s not something you think your business already does or can do at all, it There are procurement and commercial specialists in the relevant public sector body contracting who can help you navigate the process. It’s important to be very clear about the specific aspects of social value being provided – you need to be able to communicate what you can deliver and how it can be accurately measured, whether it’s something you already do or if it’s something you agree to have done if you win a contract.
The future of procurement
Inevitably, the future of procurement is closely tied to social value, and this is undoubtedly a positive step forward for the sector, demonstrating the power of procurement to bring positive change to communities. local. With well-thought-out plans and proper success metrics in place, there’s no need to be intimidated by change. Teams of experts, such as those of YPO, are here to offer a compliant route to market, as well as guidance to all vendors who wish to engage with the social value agenda. I look forward to seeing the continued elevation and positive results that Social Value delivers in the months and years to come.